No Negotiation Without Ag Market Access

A ranking US trade officials reassured US senators that nothing will move ahead in the ongoing Doha Development Agenda trade negotiations until the European Union presents an acceptable offer on agricultural market access (WTD, 10/27/05).

Deputy US Trade Representative Peter Allgeier testified before the Senate Finance subcommittee on international trade yesterday.

Mr. Allgeier told the panel that the EU offer must not be "incremental" tinkering at the margins of an earlier unacceptable proposal. He told the panel that the United States was encouraged that the Group-of-20 developing-country coalition has matched the US proposal to "cap" the number of sensitive products in industrial countries to one percent of tariff lines. The last EU proposal suggested an 8-percent cap.

Speaking to reporters after the hearing, Mr. Allgeier said the United States expected to receive today an EU offer and that the planned teleconference among the "Five Interested Parties" the United States, the European Union, Brazil, India and Australia will go ahead.

Two pillars of the agriculture negotiations have reached a point in the negotiations that could lead to a successful Hong Kong ministerial meeting in mid-December, the Deputy USTR told the panel.

But, a market access offer from the EU is holding things up just a few weeks before a crucial Hong Kong ministerial meeting.

Mr. Allgeier also reminded the senators that the ambitious US offer which includes substantial cuts in domestic farm spending is contingent on other countries coming forward on market access.

Other Aspects of DDA

The USTR official outlined imperatives for the two other aspects of the DDA. In nonagricultural market access, Mr. Allgeier said tariffs have to be reduced from their current applied levels and not the often much-higher bound levels.

High-quality offers must come forward in the services negotiations to satisfy the United States.

On rules, Mr. Allgeier assured Sen. Mike Crapo (R-Idaho) that nothing resulting from the Doha negotiations will weaken US trade laws.

He said the United States is promoting greater transparency among other nations in applying antidumping and countervailing duty laws.

The only area where trade disciplines should be increased is in government subsidization of fisheries.

It is apparent, Mr. Allgeier continued, that time cannot be wasted. The United States is prepared to lead others by example, but it will insist on an overall balanced package in the end.

At a separate forum earlier in the day, House Ways and Means trade subcommittee member Phil English (R-Pa) warned the Administration not to trade off its import trade laws at the Geneva negotiations.

Unfortunately, he told a meeting of the Washington International Trade Administration, some countries are maneuvering in the rules negotiations in exchange for gains in other aspects of the talks.

With or without special Presidential Trade Promotion Authority, Mr. English said Congress will reject a final DDA agreement if it sees any weakening in US trade laws.

Despite the current crisis in agriculture, Mr. English said he was optimistic that the negotiations would move forward and result in a successful Hong Kong ministerial meeting pushing the talks to a finale at the end of next year.

Mr. English said Brussels has to screw up its courage and abandon the strong protectionist agricultural pressures in Europe. Only with a breakthrough in agriculture can the EU get what it wants in industrial market access and services. The member suggested that NAMA and services negotiations could move quickly if the agriculture logjam were broken.

"They are at a critical point," Mr English said.

Austria's Mr. Bartenstein

At the same forum, visiting Austrian trade minister Martin Bartenstein who also is vice chairman of the upcoming Hong Kong ministerial described the history of the DDA as "two steps forward and one back." He said the 1999 WTO ministerial in Seattle and the 2003 session in Cancun were both steps backward, but the July 2004 General Council meeting which agreed to the framework setting the parameters of the talks was a big step forward.

Mr. Bartenstein noted that there were seven weeks before the mid-December ministerial.

But the Austrian official suggested that a substantive agriculture offer may not be forthcoming until the planned European Commission General Affairs Council meeting of foreign and trade ministers set for November 7. France has called for a full discussion of the negotiations at that meeting. EC President Jos